The Shenzhen branch of the People’s Bank of China is cracking down on illegal forex and cryptocurrency trading firms, shutting down 11 companies involved in trading, finance, or digital assets.
46 companies were suspected of being involved in illegal activities
Local reports said that the Chinese Central Bank’s Shenzhen branch had compiled a list of 46 companies suspected of being involved in the illegal trading of virtual currencies by the end of July. The investigation cracked down on illegal transactions in virtual currencies and online speculation in foreign currencies. The branch shut down 11 companies suspected of being involved in unlawful cryptocurrency speculation or trading.
The Chinese government wants to take the lead in providing digital financial services for capital projects. China Merchants Bank will carry out projects and online businesses that allow Chinese citizens to use foreign exchanges. In addition to regulating private financial companies, commercial banks will also be required to implement various services developed by the Central Bank.
Shutting down these 11 companies is just the first step of the 46
The crackdown on cryptocurrencies has been going on in China for many years. Shutting down these 11 companies is just the first step of the 46. The central bank says these efforts will continue, especially in the second half of 2021. Part of the campaign’s goal was to establish “precision education” for retail investors, leading to client profiling and the organization of personalized risk prevention and education programs.
In the meantime, the Chinese government is vigorously pushing ahead with the introduction of a digital yuan. The digital currency has undergone several testing procedures in major cities, including Shenzhen province. Citizens also have the opportunity to use the digital currency to test it for daily use.